Hope for the little people

Has CPUC given up on $3.3 billion ripoff?

At a meeting on September 11, the California Public Utilities Commission (CPUC) was expected to take up the so-called "settlement" by which ratepayers of Southern California Edison and San Diego Gas & Electric were to cough up $3.3 billion over the failure of the San Onofre nuclear plant, now shuttered.

The so-called compromise was made among the Utility Reform Network (TURN — a self-professed reform organization), the CPUC's Office of Ratepayer Advocates, and the two utilities. Opponents say San Onofre's failure was a result of management blunders, and shareholders — not ratepayers — should have to shell out the money.

But today (August 29), the commission gave hope to opponents of the giveaway. Instead of considering the so-called settlement on September 11, the commission will take up San Onofre-related issues that date back to initial discussions on the 2012 shutdown of the plant.

The CPUC, the most Byzantine of public bodies, normally obfuscates its moves with statements written in their own argot. Nonetheless, two San Diegans that have been fighting the $3.3 billion gift to the utilities — Ray Lutz of Citizens Oversight Projects and attorney Mike Aguirre — are hopeful. "The CPUC may be getting cold feet about the $3.3 billion nuclear bailout," says Lutz.

Today's announcement "is inconsistent with proceeding with the $3.3 billion settlement," says Aguirre. The subject that the CPUC will consider on September 11 would have been eliminated by the $3.3 billion settlement, he notes.

Comments

I'd say there's a glimmer of hope. Isn't this operation known for its inconsistent operation, though? It could be a ruse to get the opponents to drop their guard, or it could be a case of going through the motions of a review before imposing the deal that was already worked out.

Visduh: Yours is a percipient comment. Yes, the CPUC is a Byzantine, slippery outfit in which people write and speak in an arcane code, intended to befuddle outsiders. I tried to get that across in the blog item and previous writings. If I didn't, I am sorry. This change in the meeting could be significant, and it could be a head fake. Best, Don Bauder

Gov. Brown had a little private chat with Mr. Peevey when they were both on Gov. Brown's Mexico junket and Gov. Brown told Mr. Peevey that this settlement is making everyone connected with it look lame and BTW: it is an election year...

A major step in the right direction, since the CPUC now has far too much power to be operating behind closed doors as the recent history of ever higher rates and/or too cozy relationships with the Utilities the CPUC is mandated to regulate.

Gov. Brown needs to put his personal friendships aside and clean up the CPUC or admit that his Office is part of the CPUC problem now facing far too many Californians who are being over charged for their energy because of pro-Utility rate decisions!

CaptD: Astute analysis. I hope you are right. Peevey is definitely a problem for Gov. Brown. I doubt Brown has to worry about the election, but he does have to worry about a massive revolt among utility ratepayers in both Northern and Southern California. Best, Don Bauder

Don - This is the first time that you have called my analysis astute! Since you have called expressed an interest in my analysis, let me expand upon what I said before, with these prognostications, that I believe will explain why Gov. Brown should be very concerned about the part he has played in not only what I like to call CPUC-Gate but also what is rapidly shaping up to be CA's own Water-Gate.

Gov. Brown has now set himself up for his opponent to blame both the high costs of Energy and the shortages of Clean Water on Gov. Browns poor leadership. Both will be red hot topics for all voters to consider in the upcoming CA election.

If CA is going to prosper, then two things must change dramatically:

1.) The high costs of Energy must come down and not continue to spiral upward. Ever more Californians now know that they can now install solar panels on their roofs in order to drastically reduce their Utility bills if not just about eliminate it. Note: These same solar panels can also charge up the batteries of all the new electric vehicles which now cost only about a dollar a day to operate. In comparison, the costs of gasoline and diesel continue to spiral upward, which is no longer affordable, since so many Californians spend so much time in grid-lock twice a day, and it will only get worse.

2.) The availability of Clean Water must be doubled in California otherwise everyone except Big Water will suffer and Californians do not enjoy suffering. Since CA is right next to the Pacific Ocean, it makes perfect sense to install enough desalinization plants all along the coast (or perhaps even slightly off shore) in order to enable Californians to stop living in a drought that will only get worse as our Leaders chant Save Water while at the same time approving ever more development.

At least so far, Gov. Brown has shown that he is not interested in making either one or both of these two important changes happen. In fact, his recent track record proves that he is moving California in the opposite direction (by supporting the agenda of his Wealthy donors) which continues to frustrate the vast majority of all CA voters, which includes Seniors and everyone else that is not Wealthy. They know that if things get any more expensive, they may very well be no longer able to afford to continue to live in CA. This is especially true for all of the minorities, that are now living paycheck to paycheck yet want to remain in CA, rather than have to relocate to some other State where their quality of life will most likely be even worse!

CaptD: I agree with everything you say except your claim that this was the first time I called your analyses "astute." Not so. I have admired your analyses and said so many times.

I agree with you that rooftop solar is the answer -- I have been proselytizing for that for years. I agree with you that Brown has neglected water and high energy rates. I am not sure, however, that his neglect of these issues makes him vulnerable in the upcoming election. You are correct: Brown is doing the bidding of his wealthy donors. Best, Don Bauder

In short, Californians are proud of where they live, so having to make a political decision at election time between changing who they support as Governor or the possibility of having to move out of California due to rising costs will be a no brainer.

Yes Governor Brown and Mr. Peevey are friends, but this is business, as they said in The Godfather movie. Mr Peevey is almost at the end of his term, so it makes absolutely no sense for Gov. Brown to take any chances on his next election of getting blind sided by his opponent who if he is smart will promise voters that if elected, he will immediately replace Gov. Brown's Pro-Utility CPUC with a new Pro-Ratepayer leaning CPUC, who would then work to immediately lower Energy costs in California!

Gov. Brown will now try and counter that argument by making sure that the CPUC changes tack to reduce the friction/heat they have caused, even though they have a cozy relationship with the Utilities and the MSM. To do this the CPUC must now at least appear to be open to modifying their proposed settlement for the San Onofre replacement steam generator debacle and being far more sensitive about the PG&E explosion in northern CA, which they tried to downplay.

Best case scenario, is that the CPUC gets reformed and starts promoting for ratepayer equality instead of Utility profitability. To prove that this happening, the CPUC might very well have to act quickly by allowing discovery into the role that SCE engineers played in the San Onofre replacement steam generator debacle and even directing SCE to pay actual refunds to ratepayers, (instead of just shifting accounting debt from one account to another) for the $3.3 billion. If really hard pressed the CPUC will also begin an immediate investigation into all the earth quake issues at the Diablo Canyon Power Plant which just recently came to light recently. The Associated Press revealed a confidential document distributed inside the NRC by their Chief Inspector, Mr. Peck. Hopefully, the report will be made public.

Worse case scenario, If Mr. Peevey remains part of the CPUC, and the CPUC investigation becomes a delaying tactic then we will know that this is all smoke and mirrors to insure that all those in charge are not really interested in making things better despite all their condescending speeches.

captd/founder
A couple comments re the changing of the CPUC. While I agree with you that the CPUC's actions are a detriment to the people of California, neither Brown nor, in the most remotest of possibilities, Cashncarry, can simply "immediately replace Gov. Brown's Pro-Utility CPUC with a new Pro-Ratepayer leaning CPUC." Instead of going into the lengthy details, which you can look up on your own if you are interested, the CPUC has constitutional status. How the commissioners are chosen, the length of their terms, and most importantly, how they can be removed from office, is defined by the Constitution of the State of California. The Governor CAN relieve the President of the Commission of that position, but neither he nor anyone else can simply replace any sitting member of the CPUC; It takes a 2/3 vote by the Senate and the Assembly and there are very specific policies and procedures that the law requires to be followed. I don't think Peevey will be back after his current term expires in December. But Florio and Sandoval are there until January of 2017, Peterman until December 2018 and Picker was just appointed this year. Brown won't have to "counter" anything because removing/replacing ANYONE as a commissioner is beyond his purview; that belongs to the state legislature. And since the one and only Debate is this Thursday, obviously the CPUC meeting won't play a factor.
Look, I think the CPUC is as big a problem as you do. Nevertheless, as many times as you've called for it, you just can't change who is on the CPUC or how they are chosen at a whim. It would take an amendment to the California Constitution and that's simply not going to happen. The Constitution can be changed by initiatives passed by voters. Initiatives can be proposed by the governor, legislature, or by popular petition. The Governor and the Legislature aren't going to do it, and quite frankly, I don't think enough people are aware or care enough to sign a petition. It takes signatures equal to 8 percent of the votes for all candidates for Governor at the last gubernatorial election. Based on the turnout of the last gubernatorial election,it would probably take at least 750k signatures just to get it on the ballot. Just not enough people care because it takes a lot of money and resources to gather that many signatures and the "special interest groups" can spend a lot more to defeat it. As I have said, I don't think Peevey will be back. Perhaps that means maybe a more consumer friendly commissioner will be appointed president, one who actually has a desire to serve the public and correct some of the wrongs perpetrated by Peevey.

danfogel: I won't argue with your points. However, removal of the person at the top, Peevey, would send a very significant message to the other commissioners. And, on balance, I think Brown has appointed some good people to those other commissioner posts. Thus far, they have been disappointing, but a big nudge might help. Best, Don Bauder

Since Gov. Brown can exert enormous influence upon those that sit on the CPUC, he is in a position to change the course of future CPUC decisions, especially if his political agenda needs some help before the election.

I'm sure what you said about the CPUC is factual, but I also believe that if Gov. Brown asked those currently sitting on the CPUC for their resignations they probably would comply, especially if there were calls from the public to do the same thing.

Energy costs and water availability are both creating a political tipping point that the voters of CA are concerned about, so if there is going to be a change now is the time it will happen.

founder/captd
we agree in principal, but differ on the details. That yours is a different opinion than mine is of no matter to me.
Personally, I don't think any of the commissioners, including Peevey, would submit their resignations if asked. Just my opinion. And as for Brown exerting "enormous influence upon those that sit on the CPUC", that's a pretty steep and slippery slope. Brown can of course, exert pressure publicly. But the CPUC is a constitutional entity. Were Brown to "exert enormous influence" in the wrong way, it could be considered abuse of power and Brown is way to smart to even think about it. And the other thing is this. Brown is a politician, replete with the abundant ego/power trip that comes with being in charge. To ask for anyone's resignation, other than Peevey's, would be admitting a mistake in their selection in the first place. Brown is to experienced and that's not going to happen. No one is calling for anyone's resignation other than Peevey's. And, imho, Brown isn't worried about being re-elected, so he has no political reason to go after the other commissioners.
Finally, quite honestly, while energy and water issues continue, I don't see this as anything near a "political tipping point that the voters of CA are concerned about". The reason why? In the primary, there was a record low voter turnout. Less than 4.5 million people voted. That's 25 percent of the 17.7 million who are registered and 18.5 percent of the 24.1 million who are eligible. Apparently, not that many people care enough to even show up

CaptD: I agree with almost all of what you say. However, let me pose a question: Brown's opponent is a Republican. Do you really think he will campaign on making the CPUC pro-consumer instead of pro-utility? C'mon. Where do Republicans get their money? Same place as Brown gets it. Both parties get their sticky fingers on filthy lucre and pay off their well-heeled donors.

As I have said before, we have a plutonomy -- an economy designed for the rich -- and a plutocracy -- government massaging the rich. Best, Don Bauder

capt'd/founder,
since you believe a "decision at election time between changing who they support as Governor or the possibility of having to move out of California due to rising costs will be a no brainer", are you saying that YOU believe that Brown is going to lose? I'm curious, because to me, that sounds like what you are saying?

danfogel - I think that these two issues MAY actually become a threat for Gov. Brown and therefore he will do whatever it takes to eliminate them both.

If that means urging the CPUC to throw SoCal ratepayers a big fat bone paid for by SCE/SDG&E then that is a small price (for Gov. Brown) to pay to insure that he remains in office and keeps his options open for a future run at the Presidency of the USA.

CaptD: I understand Brown will be 80 when his term ends, if he is reelected. That would mean he would have to enter the race in 2016 when he is 78, and governor, or in 2020, when he is 82. Pretty old. I know. I'm 78. Best, Don Bauder

founder/captd
OK now I know that you are just messing around with your comments. Brown would be almost 83 yrs old when the the future POTUS is sworn in after the 2020 election. Neither Brown nor anyone else in their right mind thinks Brown will make another run. As for Brown being worried about November, I agree with Don Bauder. At this point, Brown would have to drop dead, and even then his name would still be on the ballot and his corpse would get more votes than Cashncarry
BTW, how about answering the question, since I answered it for you: who do YOU think is going to win, because as I said, it seems that you favor Cashncarry.

don bauder, that may well be. But if founder/captd actually thinks that Brown is actually keeping "his options open for a future run at the Presidency of the USA", well then who knows. But the point is that founder/captd is really good with asking others questions, but is terrible about responding in kind. This is the second time in just the last week or so that there has been a lack of response to posit directed towards him.

captd/founder
Here's something else to consider. The Los Angeles metro area is the second largest in the country and it's population is about 1/3 of the entire state's population. The MWD supplies water to the LA metro. It is the largest supplier of treated water in the country, providing water to 18 million people in a 5,200-square-mile area. That's bout 1/2 of California's population. To quote an article from LAT "The drought is not a constant presence here. Los Angeles residents are generally environmentally oriented, but they’re feeling the drought less than they otherwise might, in large part because the Metropolitan Water District of Southern California invested ratepayer money in the 1990s building and filling reservoirs." Until or unless the majority of those 18 million customers start to panic, water will NOT become a major political issue, for Brown or any other Governor. And that's at least 2 or 3 more drought years away.
Oh and BTW, I'm still waiting for an answer to my question.

The IID (Imperial Irrigation District) provides electricity to the eastern end of the Coachella Valley. It is rate payer owned and has one rate for electricity. It is nonprofit therefore the rates are 40% of what SCE (Southern California Edison, parent co of SDG&E) are. Utilities be they water or electricity or natural gas should not be privately owned. SONGS is a perfect example of private ownership corruption along with the useless PUC. Songs was built with public and invertor funds by a stockholder owned entity and then given a monopoly. When the corporate idiots made a bad decision they immediately turned to the ratepayer with the help of the PUC to recoup their losses. In the real world it is the corporate weenies and their stockholders who take the hit. The PUC is corrupt and its members are nothing more than political hacks who should be jailed along with SCE/SDG&E management. They should be taken over by the government under RICO.

AlexClarke: I don't have a problem with private ownership of utilities as long as there is effective and pro-ratepayer regulation. California doesn't have that, thanks greatly to Brown appointing his buddy, Peevey.

rshimizu12: And San Diegans should appreciate that Aguirre, thus far, has been doing this for nothing. The CPUC has denied him intervenor fees, even though he has won the major battles, and spent far more time fighting than any other intervenors. Intervenor fees are a scam to guarantee that intervenors play ball with the commission. Best, Don Bauder